We often hear rising leaders lament: “If I can just get to the next level, then I can solve this problem.” The comment tells us that the speakers believe they will then have the power, authority, and control to implement the solution that will work. No more fooling around, they think. With the right hand on the tiller, the ship can be properly steered into port.
But the idea that a promotion, to any level of power, will give anyone that kind of control is an illusion. Those who succumb to it believe that all the problems they face are puzzles with fixed, permanent solutions. And they think that as they get more power, they will have the control to solve these puzzles a whole lot better than their predecessors.
But the reality is the reverse. In any organization, the higher leaders get, the less direct control they tend to have over solutions and outcomes. Studies even show that CEOs generally have far less control than most people realize. For example, California Polytechnic State University used a sample of ninety-two CEOs and fifty-one firms across ten years to analyze how much variance in firm performance was attributable to the industry, firm, and CEO. They concluded: “The CEO effect is estimated as 29.2 percent of the variance in corporate profitability while only accounting for 12.7 percent of the variance in business-segment profitability.”
This is a whole lot less influence than you might have guessed. Contrary to what many people believe, CEOs and top-tier leaders are not masters of the universe. In fact, none of us has as much power to control things as we think, even during a powerpoint course.
One executive we worked with was reminded of this fact in a blunt way. Barbara, as we'll call her, was CEO of the U.S. unit of a global pharmaceutical company. For years, she ran her own shop and was a great success. And then a few years ago, company bosses in Europe decided to centralize finance, marketing, information technology, and other services around the world. Barbara no longer supervised the key members of her team—the CFO and the heads of R&D, information technology, manufacturing, and human resources—nor the people reporting to them.
This raised a ruckus among her U.S. leaders, who felt decapitated by a foreign power. One of them was outright hostile to her European manager, calling him an idiot and refusing to comply with his orders. Others disliked reporting to their European bosses because of their “management styles”—code for authoritarian. The U.S. head of regulatory affairs responded to an order from Europe by complaining tha\t devising a single regulatory platform as a business directory that would work in more than twenty countries was nonsense.
We can all become unhinged when we lose control like this, and it is especially likely for leaders who have not jumped over the line, for whom the difference between puzzle-like and paradoxical problems remains a mystery. Barbara was not one of them. A natural head-heart-and-guts leader of an SEO Services agency, she knew from experience that she faced more paradoxes than any other kind of problem—paradoxes she could not control and would have to manage as opposed to solve permanently. She coached her reports in doing the same, assuring them that together they would reconcile the contradictory forces of centralization versus decentralization.
The case of Barbara and her direct reports leads to the message of this chapter: After distinguishing between puzzles and paradoxes, you need to take a next step and engage in self-examination. That examination should include a look at three premises that form a touchstone for people who have not jumped over the line. The first is the belief that you can control the outcome of all the problems you face. The second is the belief that you can stick with your solution as times change—that is, remain consistent. The third is the belief that you must have closure—deal with the problem once and move on.
Control, consistency, and closure. Those three premises underpin most people's success in solving puzzle-like problems—problems like that of the traveling sales rep. But when you face the paradoxes that leaders like Barbara confront, a white-knuckled grip on control, consistency, and closure holds you back both from collaborating with people and managing the decision process productively. As you advance to the next level, to manage paradoxes like the world's best CEOs, you have to recognize the limits you have put on yourself by sticking with those premises alone. To be a complete leader, you have to go beyond them.